ECONOMICS,FINANCEasituationin which acountry,company, ororganizationowesmoremoneythan it canpayback so that it cannotaffordto make newinvestments:Debtoverhangin the USleavesit morevulnerableto the nextdownturnin theeconomy.Thisstudyexaminestheimpactofdebtoverhangsonagriculturaltrade.(Definition ofdebt overhangfrom theCambridge Business English Dictionary? Cambridge University Press)
Examplesofdebt overhang
debt overhangA firm facingdebtoverhangcan not issue new junior debt because default is likely.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Thisdebtoverhangthen began holding back the economy as consumers paid down debt (which reduces economic activity) rather than spend.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Academic research suggests that if the government bought common stock or toxic assets in troubled banks that thedebtoverhangproblem would be better corrected.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Potentially insolvent banks have made too few good loans creating adebtoverhangproblem.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Debtoverhangalso prevents firms that are insolvent, with assets worth less than their liabilities from recovering from their troubles.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.The effect of thisdebtoverhangis to slow consumption and therefore economic growth and is referred to as a balance sheet recession or debt-deflation.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Moreover, more debt will make the problems ofdebtoverhangworse not better.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.In the eventual shakeout (due yet again, in the last instance, to latent underemployment), thedebtoverhang is preserved by substituting public debt for private debt (bailouts), andkeeps growing.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.This is thedebtoverhangproblem.FromWikipediaThis example is from Wikipedia and may be reused under a CC BY-SA license.Debtoverhangmakes it all the more difficult for governments to engineer the trade-offs required to construct such foundations.From theCambridge English CorpusThese examples are from corpora and from sources on the web. Any opinions in the examples do not represent the opinion of the Cambridge Dictionary editors or of Cambridge University Press or its licensors.#https://dictionary.cambridge.org//dictionary/english/debt-overhang##
